Challenging the myths of online behaviour in Australia
In our digital age where technology models are disrupting almost every business sector, the idea that consumer demand is fuelling these rapid changes is almost universally accepted.
Yet research indicates not all Australians are spending their entire working or social lives online.
Nor are they ticking off every job on their personal to do lists with a swipe or a click. This is a challenge for digital businesses wanting to capture more market share. But it’s also an opportunity to understand what it might take to move more reluctant users along their digital adoption pathway.
Australia Post's recent insight paper: Australia’s pathway to a digital economy, reveals that while 93 per cent of Australians have internet access, only 31 per cent are ‘Enthusiasts’. Even among the most digitally advanced, online service adoption is still not universal.
What’s more, ‘Socialisers’ (18 per cent of the population) use the internet solely for information search or communication. ‘Pragmatics’ (25 per cent) are more likely to use online banking for convenience but less likely to make an online purchase.
These two groups (almost half of all Australians when combined) could be considered low hanging fruit for increasing service use or product purchase.
But first, let’s address the following four common misconceptions about who these groups are and what they really want.
- Online shopping is all about Millennials
- Digital natives don't mind sharing their personal data
- Digital adoption increases with income level
- We have a burning need to do everything online
According to KPMG’s 2017 Global Online Consumer Report, Generation X made more online purchases in 2016 than any other age group primarily due to their stage of life and income. Baby Boomers are also not to be ignored. They spent more on average per transaction than any other age group - $203 compared with $173 for Millennials. (It’s also worth noting men spend more online than women.)
Of course, Millennials will eventually move into that stage of life/income category but their habits might be different. For example, the KPMG report picks online groceries as a potential growth area but for prepared fresh meals rather than the weekly supermarket shop. Millennials are also more likely to subscribe to books, music or TV than buy them outright.
Every behavioural group identified by the research had concerns about privacy and security – and this is their primary barrier to doing more online. Even ‘Enthusiasts’ reported worrying about security when paying bills or sharing photos online, while 64 per cent of 'Pragmatics' said this was their biggest concern.
The latest Australian Community Attitudes to Privacy survey found 83 per cent of Australians believe their privacy risks are greater when they deal with organisations online. And this means they’re choosing who to transact with based on who they trust.
Only 36 per cent of online users feel comfortable giving their credit card details over the phone – while as many as 47 per cent may give false information to avoid sharing what they consider to be personal data (including their phone number or date of birth).
‘Pragmatics’ actually have the highest proportion of respondents earning over $1,000 per week (53 per cent, compared with 42 per cent of ‘Enthusiasts’). That’s another reason to prioritise their digital experience, and give them more reasons to do more online.
Both these groups suggested they’d be more likely to shop more online if better options were available, and the service (such as delivery) or experience (such as speed of repeat orders or recommendations) was improved. Security was their number one priority for using the internet more often for banking or paying bills.
While only 7 per cent of all retail spending was done online in the six months to April 2017*, brick and mortar retailers shouldn’t feel complacent.
KPMG’s figures put the global online retail sales average at 8.7 per cent in 2016 and forecast this to grow to 14.6 per cent (or $4.1 trillion) by 2020.
The reality is, all internet users spend about 69 per cent of their time online searching for general information. Along with email, that’s our first step onto the digital pathway. And while online banking is becoming more mainstream, eCommerce sites still have one of the lowest levels of trust in privacy at 19 per cent followed only by social media.
So until organisations improve trust in their online services or products, we’re unlikely to open up our wallets more often or share our data as part of an online transaction.
Learn more about the demographics of our online behaviour in our latest insight paper, Australia’s pathway to a digital economy.
* NAB Online Retail Sales Index April 2017